Consumer Media is Learning That Data Is the Product

I have found that many in the content world struggle to understand that content is a means to an end versus the actual end. I know this sounds blasphemous coming from someone who has pounded the table about the content being the product, but that doesn’t change the fact that content is a means to an end.

The actual end is a monetizable audience. If we remember the flywheel of media, the content’s purpose is to build a significant audience so that we can monetize the readers. And then, we reinvest that money back into more content so we can build a larger audience.

Companies advertise with us because we have the audience they’re trying to target. And while great content gets us that audience, they’re not buying the content.

I was chatting with a friend the other day, and he said, “consumer media is five years behind b2b when it comes to their businesses.”

Ultimately, this boils down to the 1st-party data b2b media companies have and our specialty in delivering actual performance to advertisers. And as the subsequent few years progress, we’ll see an increasing number of consumer media companies start leaning into what has worked so well for b2b media companies.

Here’s a good example…

Bloomberg Media announced earlier this week that it was removing all of its open-market programmatic ads. According to an Adweek story, this also includes any tools (Taboola) that drive people away from Bloomberg:

The decision aims to improve the user experience, as open-market programmatic display ads undergo few quality assurance processes, meaning the creative or product they market could be misaligned with the Bloomberg Media brand. While open-market ads only represent about 5% of the publisher’s inventory, the decision will mean turning away short-term ad revenue for longer-term gains.

Citing data from internal testing, the publisher believes the improved experience will encourage readers to return more frequently, consume more content and build more regular habits. Bloomberg Media will also use the newly available inventory to serve house ads, promoting its editorial products, such as newsletters, podcasts, events and television programming.

Sean Griffey at Industry Dive summed it up perfectly:

It’s positioned as a user experience benefit (which it is) but I suspect it’s a recognition of the value of their 1st party data. Doesn’t make sense for premier brands to give away

B2B media companies have always valued 1st party data because they had no choice. They needed to prove to partners that they had the right readers and that these people were likely to make informed purchasing decisions. If you couldn’t prove that, advertisers were far less likely to spend with you.

But that wasn’t the priority at consumer media companies. Instead, their focus was simply on driving enough pageviews that they could eek pennies out. But this is also why certain advertising struggles when the economy turns. If you can’t prove the value of your audience, you don’t have a business.

And that’s what Bloomberg figured out.

Bloomberg has a ton of valuable data. Its audience is comprised of some of the wealthiest people on the planet. The readers run the biggest businesses in the world, influence more purchasing, and likely purchase more luxury goods compared to most other media companies. So why would Bloomberg ever want to allow someone to underpay for that?

Open-market programmatic advertising lets marketers be lazy. They don’t have to talk to anyone and can target their ads as much as they want. So, a marketer can sit down, pick Bloomberg as their target, put a bid in, and then wait for the impressions to rack up.

Now you can’t do that. So if a marketer wants to get on Bloomberg in front of this highly influential audience, they’ll be forced to have a conversation with someone at Bloomberg. And that’s what B2B media companies have had to do forever.

But what does it mean to have data as a product?

In Bloomberg’s case, it’s likely specifics about what types of assets people are interested in, the companies and industries they work in, and various other data points that create a well-rounded individual.

For a more traditional consumer media company, it’ll be something different. For example, if you’re running a food site, understanding which readers are interested in BBQ recipes versus baking is likely important when McCormick comes along and says it wants to advertise its cayenne pepper versus its pumpkin spice. Being able to tell McCormick where the demand is will allow you to sell the ads for more.

But it doesn’t stop with the data. B2B media companies have figured out that they can create many innovative ad products powered by that data. So rather than forcing buyers to spend wide, they can go deeper where the dollars drive much more performance.

Here’s an example I learned about last week. Let’s stick to the food category. Imagine your typical editorial newsletter where each recipe is tagged with a keyword: pumpkin pie, chocolate chip cookies, chocolate cake… Is anyone else hungry? I digress…

You can then get a sponsor for each of those tags. However, the product isn’t a banner ad on the site or newsletter. Instead, you create a segment in your database for every person that clicks on the pumpkin pie recipe. Then, some period after clicking that link, they can receive a drip dedicated send that offers them a factory coupon for pumpkin spice.

Only people who engaged with the pumpkin spice recipe will receive that dedicated email. This helps the advertiser because they’re targeting buyers who are most likely to buy that spice. It helps the reader because they receive an actual coupon for something they needed for the recipe—and hopefully, a dedicated send that doesn’t bother them. Plus, because it’s a coupon, McCormick can track how it performed and see if it was worth the investment.

This is only possible if you have data about your audience. Having great recipes—in the case of a food site—is essential, but having data about your audience and segmenting it to create products is far more critical to your advertisers. Ultimately, what b2b media companies are selling is data. And consumer media companies will have to catch up because, sooner or later, they won’t have 3rd-party cookies to help support the programmatic running on their site.

It’s easy to see why Bloomberg decided to get rid of open-market programmatic. I expect to see similar moves made by its competitors over the coming year as they ramp up their 1st-party data offerings. But for consumer media companies that are five years behind, now’s the time to play catch up. Figure out your data taxonomy, develop a series of products, and then sell access to it. The revenue you generate on readers will be far greater.

Thanks for reading. If you have thoughts, hit reply. Or join the AMO Slack to discuss this in more detail. Have a great weekend!